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Barack Obama withdraws from APEC summit as US government shutdown impasse continues

Updated
Sat 5 Oct 2013, 12:22 AM AEST

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Barack Obama withdraws from APEC summit as government shutdown continues

7pm TV News ACT

US president Barack Obama will not attend the APEC leaders' meeting in Bali next week, as he attends to the enforced shutdown of American government services.

The cancellation of his trip was a direct result of the budget feud being played out in Washington.

"The president made this decision based on the difficulty in moving forward with foreign travel in the face of a shutdown, and his determination to continue pressing his case that Republicans should immediately allow a vote to reopen the government," the White House said in a statement.

Indonesia's foreign minister Marty Natalegawa says Mr Obama called Indonesian president Susilo Bambang Yudhoyono to inform him of his decision this morning.

"Of course the president of Indonesia fully understands the situation that president Obama is facing and at the same time is confident that the discussion that we are to have here in Bali will continue in the manner that we have been preparing for," Mr Natalegawa said.

What is the APEC summit?

The Asia-Pacific Economic Cooperation was established in 1989 to promote economic growth and prosperity for the region

The group's annual meeting is held with leaders from 21 member nations that have Pacific coastlines

The aim is to promote free trade and cooperation throughout the Asia-Pacific

APEC member economies account for 40 per cent of world population and 44 per cent of global trade

The decision means Mr Obama will no longer depart on Saturday for what had originally been a four-nation, week-long Asia trip.

He cancelled visits to Malaysia and the Philippines earlier this week because of his budget struggle with Republicans in Congress.

US, China free-trade pacts on the agenda at summit

US secretary of state John Kerry will stand in for the president both at the APEC summit and at the East Asia summit in neighbouring Brunei.

The Americans are planning to use the APEC gathering to try to secure an agreement for a giant free-trade pact, which would include 12 diverse countries - but significantly not China.

While proponents of the Trans-Pacific Partnership (TPP) insist it will create "gold-standard" rules to deal with 21st century economic issues such as intellectual property, analysts caution it will likely fail to achieve targets and potentially alienate China.

China initially expressed strong opposition to the TPP, viewing it as another US containment tool, although it has recently adopted a slightly more accepting tone.

Mr Obama has said he wants a deal on the TPP by the end of the year and the US administration has earmarked the pact as one of the most important trade tools for its strategic "pivot" to the Asia-Pacific.

The TPP would bring together the economies of the US, Australia, New Zealand, Japan, Singapore, Malaysia, Brunei, Vietnam, Chile, Canada, Mexico and Peru - accounting for about one third of global economic output.

Meanwhile, China is looking to push ahead with a rival mega-trade pact grouping 16 countries in the region, potentially opening up a new front in the struggle between the world powers for dominance in the Asia-Pacific.